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IMF / SENEGAL
STORY: IMF / SENEGAL
TRT: 3.05
SOURCE: IMF/ WORLD BANK
RESTRICTIONS: NONE
LANGUAGE: FRENCH / NATS
DATELINE: 2 DECEMBER 2010, WASHINGTON DC/ FILE
FILE - RECENT, WASHINGTON, DC
1. Wide shot, exterior IMF
2 DECEMBER 2010, WASHINGTON, DC
2. SOUNDBITE: (French) Norbert Funke, IMF Mission Chief to Senegal
“The Senegalese authorities wanted a program with the IMF. The program aims to increase Senegal’s growth rate and to reduce its vulnerabilities to external shocks. This is a non-financed program that will benefit from the IMF’s economic advice and regular reviews. This could be a positive signal for domestic and international investors and for the donors who are very active in Senegal.”
3. Close up, Funke’s hands typing on a keyboard
4. SOUNDBITE: (French) Norbert Funke, IMF Mission Chief to Senegal
“The objectives of the program are to increase the growth rate and reduce its vulnerabilities to external shocks. After some difficult years, the growth rate should increase to 4% for 2010, which is much higher than the previous years. Senegal has a lower growth rate compared to other Sub-Saharan countries in Africa. That’s why increasing economic growth is an important goal of the program.”
5. Med shot, Funke at work
6. SOUNDBITE: (French) Norbert Funke, IMF Mission Chief to Senegal
“In Senegal, as in other sub-Saharan countries in Africa, there’s a deficit in terms of infrastructure, particularly with roads, transport and the energy sector. It is important to reduce this infrastructure gap because this will reduce costs for business and improve the business climate and increase the growth rate. In the medium term, it’s important to gradually reduce the budget deficit below 4% of GDP. It’s important to carefully chose its big investments and choose financing with low interest rates.”
FILE – WORLD BANK - JUNE 2009, DARKAR, KAOLICK, THIES PROVINCE SENEGAL
7. Wide shot, donkey carts on dusty dirt road
8. Various shots, heavy machinery building new road
9. Pan right, from workers to car on new road
10. Wide shot, donkey carts, bicycles and animals on new road
The IMF extended its support for Senegal’s economic and financial policies by approving a new Policy Support Instrument to back the West African country’s economic program.
The policies endorsed by the IMF focus on accelerating economic growth and improving resilience to shocks to help Senegal meet its development objectives.
SOUNDBITE: (French) Norbert Funke, IMF Mission Chief to Senegal:
“The Senegalese authorities wanted a program with the IMF. The program aims to increase Senegal’s growth rate and to reduce its vulnerabilities to external shocks. This is a non-financed program that will benefit from the IMF’s economic advice and regular reviews. This could be a positive signal for domestic and international investors and for the donors who are very active in Senegal.”
Maintaining macroeconomic stability and enabling more and better infrastructure investment supported by a sound fiscal policy form the backbone of Senegal’s IMF-supported program. In renewing its support for Senegal’s economic policies, the IMF underscored the need to build on recent achievements and advance structural reforms that can help raise economic growth and reduce poverty.
Senegal’s economic growth began to recover in 2010 and is expected to strengthen further in 2011. Growth is projected at 4 percent for 2010 and 4.4 percent for 2011, after averaging 2.7 percent in 2008 and 2009. Consumer price inflation turned positive in June 2010 and has picked up slightly, mainly because of higher food prices. Underlying inflation is expected to remain modest.
SOUNDBITE: (French) Norbert Funke, IMF Mission Chief to Senegal:
“The objectives of the program are to increase the growth rate and reduce its vulnerabilities to external shocks. After some difficult years, the growth rate should increase to 4% for 2010, which is much higher than the previous years. Senegal has a lower growth rate compared to other Sub-Saharan countries in Africa. That’s why increasing economic growth is an important goal of the program.”
However, Senegal’s recovery is still at an early stage and uncertainties about the short-term outlook persist. Risks relate to economic developments in partner countries, the potential for higher oil prices, possible further problems with the domestic electricity supply, and pressures typically associated with pre-election year economic policymaking. To achieve stronger growth, Senegal needs to maintain macroeconomic stability supported by a sound fiscal policy, and also implement broad-based reforms.
The Policy Support Instrument supports low-income countries that do not want or need IMF financial assistance but seek to consolidate their economic performance with IMF monitoring and support. The instrument helps countries design effective economic programs that, once approved by the IMF's Executive Board, deliver clear signals to donors, multilateral development banks, and markets of the IMF's endorsement of the strength of a member's policies.
Senegal is planning a sizeable increase in infrastructure investment. Alleviating infrastructure bottlenecks would address an important constraint to growth. To create fiscal space for priority expenditures, including infrastructure investment, Senegal is aiming to generate higher budgetary revenues, improve investment planning, and raise the quality of spending.
SOUNDBITE: (French) Norbert Funke, IMF Mission Chief to Senegal:
“In Senegal, as in other sub-Saharan countries in Africa, there’s a deficit in terms of infrastructure, particularly with roads, transport and the energy sector. It is important to reduce this infrastructure gap because this will reduce costs for business and improve the business climate and increase the growth rate. In the medium term, it’s important to gradually reduce the budget deficit below 4% of GDP. It’s important to carefully chose its big investments and choose financing with low interest rates.”
Scope exists to boost revenues by broadening the tax base, reducing tax expenditures, and further increasing the efficiency of tax and customs administrations. To improve investment planning, the authorities are committed to basing investment decisions for large projects on rigorous economic profitability assessments. Further reforms in public financial management are expected to gradually help reduce current expenditure as a share of GDP and improve the quality of spending.
Successful implementation of all these complementary reforms should lay a sound basis for higher growth and reducing vulnerabilities, which in turn would be conducive to lowering poverty.
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